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The residential battery energy storage system market size is forecast to increase by USD 6.24 billion and is estimated to grow at a CAGR of 23.02% between 2024 and 2028. There's a rising trend in the market for advanced residential battery power storage systems, driven by a growing emphasis on power resilience and security, alongside the increasing integration of renewable energy sources. This demand surge reflects a broader shift towards sustainable and efficient power solutions. Homeowners are seeking technological advancements that offer reliability during power outages and optimize the use of renewable power. This trend underscores a fundamental transition in the power landscape, where consumers are actively adopting solutions that not only reduce their carbon footprint but also enhance their power independence. As such, the market is evolving to meet these demands, with innovations geared toward creating more robust, reliable, and sustainable residential power storage solutions.
Technological advancements in residential battery energy storage systems are a primary trend in the market. The market is experiencing significant growth due to technological advancements, particularly in Li-ion battery technology. Weather changes and electricity deficiency necessitate reliable and flexible power storage solutions. Vendors like Tesla Inc. are innovating to improve power density, cycle life, and safety with advanced battery chemistries and materials, such as Cobalt and Copper. However, risks like thermal runaway, internal cell defects, mechanical failures, excess voltage, high temperatures, and gas build-up pose safety concerns. Grid storage systems, solar facilities, and electrical substations benefit from these advancements, ensuring power continuity and reducing dependence on power grids.
The lithium-ion segment is estimated to witness significant growth during the forecast period. The Lithium-ion residential battery energy storage market caters to homeowners seeking to optimize power usage, decrease grid reliance, and integrate renewable power sources effectively. Solar panels are a common integration for these systems.
Moreover, maintenance and servicing requirements are essential, with local service providers offering spare parts and expertise to ensure battery performance in harsh environmental conditions, extreme temperatures, high humidity, and corrosive atmospheres. Lithium-ion batteries, known for their high power density, long cycle life, and fast charging capabilities, are popular due to their reliability and performance. Tesla Inc., with its Powerwall product line, is a leading vendor in this segment, offering seamless solar panel integration and advanced power management features. Hence, such factors are fuelling the growth of this segment, which in turn drives the market during the forecast period.
APAC is estimated to contribute 45% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The European power sector is undergoing significant transformations, driven by the integration of solar panels and other renewable power sources. ICT applications facilitate effective power generation and demand management. Government schemes, such as the EU Emissions Trading Scheme (ETS), promote the adoption of low-carbon energy sources. Harsh environmental conditions, including extreme temperatures, high humidity, and corrosive atmospheres, necessitate maintenance and servicing from local service providers and the availability of spare parts for Residential Battery Energy Storage Systems (BESS). Hence, such factors are driving the market in APAC during the forecast period.
The market is experiencing significant growth due to the increasing integration of Lithium-ion batteries and other energy storage technologies into Grid modernization initiatives. As electricity demand continues to rise, Grid operators require reliable and efficient electricity supply systems to meet the needs of the population. Asset deferral in various sectors is driving the adoption of BESS, as they help reduce CO2 emissions from power grids and support the integration of renewable energy sources, such as solar facilities and solar panels. The market landscape depends on Solar and wind power Power supply, Grid energy storage system, Battery Energy Storage technologies, Lithium-ion battery, Lead-acid batteries, Carbon emission reduction, and Energy storage system (ESS), Electrical substations play a crucial role in the integration of BESS into power grids, enabling the efficient storage and distribution of electricity. Our researchers analyzed the market research and growth data with 2023 as the base year, along with the key market growth analysis, trends, and challenges. A holistic analysis of drivers, trends, and challenges will help companies refine their marketing strategies to gain a competitive advantage.
Rising demand for energy independence drives the market. The market is experiencing growth due to the increasing need for power independence and the integration of renewable power sources like solar PV systems. Homeowners can store excess power produced during favorable weather conditions for use during electricity deficiencies or grid outages, enhancing reliability and flexibility.
However, safety concerns such as thermal runaway, internal cell defects, mechanical failures, excess voltage, high temperatures, gas build-up, fire, and explosion pose challenges. Li-ion battery technology, which is commonly used, contains elements like cobalt and copper. Proper maintenance and safety measures are essential to prevent potential hazards. Power grids and electrical substations benefit from these systems by reducing strain during peak demand and improving overall system efficiency.
The high initial cost of residential battery energy storage systems is a major challenge hindering the market. The market faces obstacles due to the high upfront costs, which can range from USD 5,000 to USD 15,000 or more in the US. This significant investment is a challenge for homeowners, especially considering the variables that impact the cost, such as battery capacity, brand, installation complexity, and additional equipment like inverters and monitoring systems. Weather changes and electricity deficiency increase the demand for reliable and flexible power storage solutions.
However, safety concerns, including thermal runaway, internal cell defects, mechanical failures, excess voltage, high temperatures, gas build-up, fire, and explosion risks associated with Li-ion battery technology, pose challenges. The use of cobalt and copper in batteries also adds to the cost. Power grids and solar facilities at electrical substations benefit from grid storage systems, but addressing these challenges is crucial for market growth. Hence, such factors are hindering the market during the forecast period.
The market research report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Alpha ESS Co.Ltd: The company offers residential battery energy storage systems such as SMILE G3 5kW 10.1kWh and SMILE G3 5kW 20.2kWh.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative market growth and forecasting analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024-2028, as well as historical data from 2018 - 2022 for the following segments.
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The market is experiencing significant growth due to the increasing adoption of renewable energy sources and the need for energy independence. Grid modernization and the implementation of net metering policies are key factors driving the market. The use of advanced technologies such as lithium-ion batteries, Solar facility, Electrical substation, and flow batteries is becoming more prevalent in residential energy storage systems. These systems enable homeowners to store excess energy generated from solar panels and use it during peak hours or power outages. The market is expected to grow at a steady pace due to the rising demand for cost-effective and reliable energy solutions. Additionally, government initiatives and incentives are boosting market growth. The market is segmented by technology, application, and region. Major players in the market include Panasonic, Tesla, LG Chem, and Sonnen.
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Market Scope |
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Report Coverage |
Details |
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Page number |
174 |
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Base year |
2023 |
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Historic period |
2018 - 2022 |
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Forecast period |
2024-2028 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 23.02% |
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Market Growth 2024-2028 |
USD 6.24 billion |
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Market structure |
Fragmented |
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YoY growth 2023-2024(%) |
21.04 |
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Regional analysis |
Europe, APAC, North America, Middle East and Africa, and South America |
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Performing market contribution |
APAC at 45% |
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Key countries |
US, China, Germany, UK, and France |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
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Key companies profiled |
ABB Ltd., Alpha ESS Co., Ltd., Blue Planet Energy, Briggs and Stratton LLC, BYD Co. Ltd., C and D Technologies Inc., East Penn Manufacturing Co. Inc., Eaton Corp. Plc, Enphase Energy Inc., Fortress Power, Generac Holdings Inc., Growatt New Energy Technology Co., Ltd., LG Corp., Panasonic Holdings Corp., Samsung Electronics Co. Ltd., Schneider Electric SE, Shell plc, SMA Solar Technology AG, SolarEdge Technologies Inc., SolaX Power Network Technology Zhejiang Co. Ltd., Sunrun Inc., Tesla Inc., and Victron Energy BV |
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Market dynamics |
Parent market analysis, Market forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Type
7 Market Segmentation by Power Rating
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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